Bucking the trend of contraction in April and May, retail loans of rose Rs 11,518 crore in June, when economic activity started reviving. Housing loans rose Rs 6,700 crore and credit card outstanding also jumped Rs 4,699 crore.

According to Reserve Bank of India (RBI) data, — covering segments like home loans, vehicle loans, and credit cards — nosedived Rs 62,861 crore in April, followed by a moderate contraction of Rs 11,928 crore in May. Outstanding retail loan books stood at Rs 24.90 trillion in June 2020, up from Rs 24.78 trillion.

Suresh Khatanhar, deputy managing director of IDBI Bank, said economic activity began reviving in June 2020 after easing of the were also able to reach out to customers for loan proposals.

The washout in April, owing to the lockdown, began to show its effect. May was also marked by dull activity, while June and July have shown an upward trajectory. Though these are positive signs, balance sheet strength remained weak, said public sector bankers.

Micro and small enterprises saw a dip in outstanding loans. So was the situation in the medium-size segment. Outstanding loans to SME remained flat at Rs 3.52 trillion in June, compared to May.

Non-food bank credit growth at 6.7 per cent in June was little changed from the May level. However, it came in lower than the 11.1 per cent reported in June 2019, the RBI said in a statement.

Credit growth to agriculture and allied activities increased by 2.4 per cent in June 2020, compared to a higher growth of 8.7 per cent in June 2019. At the same time, credit growth to industry grew 2.2 per cent in June 2020, against a 6.4 per cent growth rate in June 2019.


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